Real Estate: Building Wealth Through Real Property

Still nascent and vulnerable , the United States was hemmed in by European powers on all sides . To the north , the British held sway over Canada , while the Spanish clung to Florida and the vast territories west of the Mississippi River .

Yet it was the French , under the ambitious leadership of Napoleon Bonaparte , who controlled the key to America's future the vast expanse of land known as Louisiana . This territory was not just any land . It was a realm of almost unfathomable potential , stretching from the Gulf of Mexico to the Canadian border , from the Mississippi River to the Rocky Mountains .

It was a prize that could transform the United States from a fledgling nation into a continental powerhouse . But this transformation hinged on one crucial question how could the USA possibly acquire such a vast and potentially valuable piece of land ? Most of us today likely consider the acquisition of a single-family home to raise a family in a great challenge .

Can you imagine trying to purchase nearly a million square miles ? At the helm of American diplomacy was President Thomas Jefferson , a man who understood the value of land . Jefferson was a visionary , a statesman who saw the future of the United States depended on its expansion westward .

But he was also a pragmatist , keenly aware of the fragile nature of the nation's finances and the need for a secure base of wealth to sustain its growth . The opportunity for expansion arose in a most unexpected manner . France , under Napoleon's rule , had grand designs for a North American empire . A visionary leader himself , napoleon had no lack of ambition .

But the realities of war and rebellion in Europe and the Caribbean began to sap France's resources and attention . Particularly the Haitian Revolution , which had turned the French colony of Saint-Domingue into a costly quagmire , had weakened Napoleon's grip on the New World . For Napoleon , the Louisiana Territory had become more of a burden than a boon .

Into a costly quagmire had weakened Napoleon's grip on the new world . For Napoleon , the Louisiana Territory had become more of a burden than a boon . His original plan to use Louisiana as a breadbasket for the Caribbean colonies was faltering and the financial strains of his European campaigns were mounting .

Recognizing the strategic disadvantage of holding onto a distant , vulnerable territory , napoleon made a fateful decision for the history of the United States of America , he would sell Louisiana to the United States . Meanwhile , president Jefferson was growing increasingly concerned about the presence of French forces in North America .

The port of New Orleans , which sat at the mouth of the Mississippi River , was the lifeblood of American commerce . It was through this gateway that goods from the interior of the continent flowed to the rest of the world .

Control of New Orleans by a hostile power could strangle the American economy and stifle the young nation's growth , and so Jefferson dispatched James Monroe and Robert R Livingston to Paris with a mandate to secure the purchase of just New Orleans and as much of the surrounding territory as possible .

The mission was simple ensure American control over the Mississippi River and its critical trade routes . Jefferson authorized them to spend up to $10 million for New Orleans and the Floridas if necessary , but neither he nor his envoys could have anticipated the offer that was about to be placed before them .

In Paris , monroe and Livingston found themselves faced with an extraordinary proposition .

Napoleon's foreign minister , charles Maurice de Talleyrand , made it clear that France was willing to sell not just New Orleans but the entire Louisiana Territory , but the price was a staggering $15 million , a huge sum for a nation still recovering from the debts of the Revolutionary War .

But the offer was just too good to pass up 828,000 square miles of land at roughly three or four cents an acre For Monroe and Livingston . The decision was immediate and unanimous . They understood that this was a once-in-a-lifetime opportunity , a chance to secure the future of the United States and create a foundation of wealth that would endure for generations .

They quickly agreed to the terms , signing the Louisiana Purchase Treaty on April 30 , 1803 . Back in Washington , jefferson received the news with a mixture of elation and trepidation . On the one hand , he had just secured one of the largest real estate deals in history , doubling the size of the United States overnight .

But on the other hand he knew that such a bold move would not go unchallenged . There were even questions of constitutionality , as the power to acquire new territory was not explicitly granted to the federal government in the constitution . There were also concerns about the nation's ability to govern and integrate such a vast and diverse expanse of land .

But Jefferson was a man of vision and he saw beyond the immediate challenges to the long-term benefits . The acquisition of Louisiana was not just a territorial expansion . It was a bet on the nation's future . The land would prove a tremendous store of wealth , a reservoir of resources that could be tapped to fuel the country's growth and prosperity .

It would serve as a buffer against foreign threats and a magnet for settlers seeking new opportunities . The value of the Louisiana Purchase was not just in the land itself , but in what land represented the potential for growth , the promise of opportunity and the security of wealth .

It was an investment in the American dream , a bet on the nation's ability to transform wilderness into wealth , to turn the unknown into the prosperous . As the years passed , the wisdom of the Louisiana Purchase became increasingly evident .

The land provided the resources needed for the nation's industrial revolution from the fertile soils of the Midwest to the timber and minerals of the Rocky Mountains . The Mississippi River became the backbone of American commerce , a conduit for the flow of goods and capital that would power the nation's economy .

The Purchase also opened the door to further expansion as settlers pushed westward , driven by the promise of land and opportunity . By the mid-19th century , the United States had become a continental empire stretching from the Atlantic to the Pacific .

The wealth generated by the land acquired in the Louisiana Purchase helped to finance the construction of railroads , factories and cities , laying the groundwork for America's emergence as a global economic power . Yet the legacy of the Louisiana Purchase extends beyond economics .

It was a turning point in the nation's history , a moment when the United States embraced its destiny as a land of opportunity and possibility , a land which believed in itself , not just in the present generation , but on down the line , through many subsequent generations as well .

In the grand scheme of history , the purchase was more than just a real estate transaction . It was a visionary investment in the future .

It was a bold assertion of the belief that the United States could and should become a great nation , a beacon of prosperity and freedom , and it was a reminder that the true value of land lies not just in its price , but in the opportunities it creates and the dreams it fulfills .

In this episode of the King's Hall podcast , we continue to explore the question that likely keeps many of us awake at night how can I leave an inheritance to my children's children ? Many voices clamor for attention and answer Invest in this business , invest in my business . Have you heard about this new crypto token ? Yet this stock is about to skyrocket .

You need to get on board before it's too late . And , to be sure , there's not merely one answer to the question . So far , we've talked about Bitcoin and precious metals , but if history is any guide , one answer . One place to build enduring wealth must be in the land itself and what may be built upon it .

In this episode , we sat down with successful real estate investor , a 35 pilot and member of our local Ogden borough , tim Six , to discuss the challenges and rewards of building a legacy through the acquisition and fruitful management of real property . The King's Hall podcast exists to make self-ruled men who rule well and win the world .

We've got ostrich boots on .

You guys talk about together , but it's definitely challenging .

You can buy a little bit of gold , you know , like gold backs is what they sell at Alpine Alpine gold here in in in Utah , and you can spend like I think it's five bucks , four bucks , something like that , for a little bit of gold and then you can buy a cheap stock on the stock market , a penny stock .

Heck , you can even buy fractional stocks now on a lot of apps and exchanges . Yeah , on Robinhood , yeah , robinhood . But with real estate , the barrier of entry is very high because you need to have a down payment on a home .

If you're doing a rental real estate , you have to have a down payment on a home and for an investor typically , I mean Tim would be able to tell you I don't know if I can , but it's like 30% or 25% . It's higher than what a standard home loan is .

And so I think , for a lot of people in our day and age , because people are so transient , the idea and because of inflation , everything else , the idea of owning a piece of property maybe wouldn't be at the top of the list . But I guess tell me why you think it should be .

Real estate plays a big part of that , partly because I'm not just interested in investing in a pile of money or a pile of something worth money , but I actually want a foothold in a place . So I recognize that for my family's mission as members of refuge church and this , this borough , here and um , where the lord has planted us .

We are long-term aiming to plant our generations here in this community and that means you .

It will definitely hurt as a church , as a community , but it won't hurt as much as it will in 50 years or in 100 years , unless we have a warlord situation and we're good anyway Because we'll own a lot more land . I like that .

Unless you get dividend bearing stocks are non-productive assets , like the only way to actually profit from them is to no longer own them , and so real estate is a productive asset . Obviously , you can rent it out , but even more than that , with real estate , I liked in your cold open , brian , you had talked about how land presents opportunity .

Yes , and so what opportunity does real estate give you when you're thinking generationally ? Well , it's not just a return on income or an investment , but you're actually . What other asset could you buy and have grandchildren raised ? Or , you know , enable your children to , to , to bring your generations in into fruition .

You know you can't do that with gold or with Bitcoin , but you can with . You know , helping your children find a place to live . You know , giving them a house , a place where they can actually raise their kids and your grandchildren . So it is a unique asset .

You know you can buy an Amazon stock and forget about it as long as you don't lose your password , I guess , to your , to your 401k or your investment platform .

Right , and it's just , it's going to be there as long as you you could screw up by not paying attention , like Amazon goes bankrupt and then all of a sudden you have a worthless piece of nothing but , for the most part , a stock Bitcoin and gold .

You know that's something that you're buying as a long term play store of wealth and hope for a return on the business . But if you think about a lot of like a stock , you're buying something to profit from somebody else's work . When it comes to land , that can be true Real estate .

You can hire companies , you can invest in real estate via lots of different vehicles , but for the most part , a lot of the people that we know that are doing this , they're actually building a business , so they're not just employing money to make money passively .

They're actually getting themselves involved in a truly productive process that their hands are going to get dirty in and they're going to learn things as they go . It's one of the draws to me of real estate is that it is truly something that you can raise your children up to learn how to manage .

Well , I like listening to the Victorian era like Pride and Prejudice reading and listening to it . One of the things I like about that book is it gives you a window into the culture of these landed families and how their reputations were tied to how they manage their land and manage their wealth . And were they good to their tenants ?

Were they good to the people that they served ? Were they a net stake in the community ? In a way that's difficult to replicate through other means , people even recognize like you either have the reputation of being good at that and being good to the people around you , or like are you ?

Are you the person that owns the terrible whatever down on Wall Avenue here in Ogden ? This like big brick building that a couple of years , years ago , like parts of it were falling off onto the sidewalk and , uh , there was like news articles who owns this building ? Let's , and it's some guy in canada , or it was someone way out .

If we take good care of this building , it says something to people . Dan's laughing because there are weeds out front of the church right now , but yeah in our last members meeting I said get used to the words deferred maintenance . You did .

So that was certainly part of the warp and woof , the ethos of being an American . But even Thomas Jefferson's idea of an intellectual agrarian , the idea that to be a part of the Republic and to be a voting member you had to be a landowner .

And there's a reason for that , because if you own the place just like we say about children you have a vested interest in the future . Well , if you own real property , you have a vested interest in the real physical future . I think this is also interesting . I was reminded of an Aldo Leopold quote and it says this .

He said there are two spiritual dangers in not owning a farm . One is the danger of supposing that breakfast comes from the grocery and the other that heat comes from the furnace . Do you desire to be shrewd financially for the sake of your family and future generations ?

We know that a robust society depends on getting this right Success in building and passing on personal wealth . Let's be mature , responsible leaders with the resources God expects us to turn a profit on to love our children and children's children .

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Joe starts with your values and goals , then provides impactful counsel to help you form and implement your financial plan . Click on the link in the description for backwards planning financial and contact Joe today to get started . The description for backwards planning financial and contact joe today to get started .

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The land shapes a people as much as they shape the land , and it's good for boys to have a creek to play in , it's good to not just have cubicles and you know linoleum . So walk me through why , in your thinking , like for your boys , you've obviously made a conscientious decision .

And , dan , you have a big space too at your house where , like your kids , can go in the garden and they can roam free and they can explore to some extent . But for you guys , why is that so just practically important for your family that you said we're going to invest in that ?

We looked ahead and we said we can , we can wait , but there was some there was importance to us of , while our children are young , securing a place like this where we think we could hand it on to them and and they will look back and say , well , this is the kind of property that's almost you can't get today .

It's already hard to get today , but in 10 years or 20 years or 30 years from now , I just think it's going to get harder to get any place like this in a place that's actually close to where all the people are right . It's not like an hour out in Morgan or way out in the .

I'm sure they'll keep developing further and further out and we made a conscious decision when we bought that place that , even though we had some equity in the home that we built in 2019 , we had three kids when we built that home . We were very strapped for budgets . We built what we could , which was like what's the cheapest way to get square footage ?

Well , go two stories straight up like a box with a roof on it and no garage , no basement , none of that , let's just go for what can we do ? But we had outgrown it , but we made the decision .

We're going to take the extra time and a lot of extra effort to keep that place and buy our next one , because the idea would be that when my children I don't just want to hand my children an inheritance when I'm dead , my children an inheritance when I'm dead I want to help them when they get into the key years of 18 to 30 in being able to establish

them here , when they have young kids , when they have kids and it's really hard , and when they can't afford to go buy a house . And so I made the conscious decision and this is opportunity cost . Any of these investment decisions we're talking about the opportunity costs is that if I , if I invest $1 here that is a dollar I cannot invest in another place .

So for us , we said and it's not that everybody has to make this decision , but we thought it made sense for us . We're going to invest in keeping that house . Getting in an uncomfortable situation to an extent like not unwise , but just it's difficult to buy another place and then rent the other one out .

It's more work , but for our goals , what are we trying to accomplish ? I'm actually trying to build a people in a place here in Ogden and in Weber County and in Utah .

So we need a space and even just practically speaking , like it is really wonderful to say I could wait and let you know a lot of people , a lot of I don't want to dump on baby boomers , but a lot of people make the mistake I think of they they sort of put all of their , their , their eggs , in the the basket of well , we'll get that dream house when

we're 60 and we have no kids and we're like empty nesters , and then we'll go and we'll , we'll get our you know whatever we're like . Well , we want to actually buy a place when our kids are still going to live in it , like we need space now . We don't need space when we're 60 .

Well , I hope we still do , cause we have a mess of grandkids running around .

But that was important to us to be able to say I want my kids to be able to grow up and say , oh , I have memories of that backyard and I love that , and then hopefully one day they'll inherit it too and you know , they'll live in it and continue to be surveys in that house for a long time .

But that was a little bit of a rambly answer , but I guess a lot of . There were a lot of things going through our head related to this exact topic in the years of planning and working towards this .

And so I got out here and in our particular region because of the mountains and the Great Salt Lake , there's just not a lot of land and so you're going to find , like point two acre lots is pretty standard 0.25 , you know , a quarter acre or something like that . So we wanted to have a little bit more space and so we bought an acre .

Now my backyard isn't as picturesque as Mr Sauvé's over here . He's got mature trees and a river and or a stream and man , I wish it was a river .

I've got a blank canvas here , I don't have mature trees . What am I going to do ? And so I planted a lot of fruit trees . I've got a big garden . We put chicken coop and some chickens in there and planted shade trees that they'll enjoy when I'm probably dead and gone , things like that .

But I'm trying to beautify the space and part of the reason I I did what I did is because when you don't have mature trees for your kids to climb in and put a tree house in and you know , do all the things that come with having mature trees , what ? What experience could I give my kids ?

Well , I could give them the experience of enjoying the shade of an apple tree and picking , you know , peaches and cherries and and raspberries , and and running through the garden and learning how to be productive , learning how to grow things , uh , appreciating beautiful things Like it is .

It is really pretty when the cherries are in full bloom in the spring and you've got the mountains that are covered in snow in the background and it's just really it's . It's a pleasant place at times to be , you know , and it's growing in maturity .

So , uh , I wanted them to have plenty of space to be able to run around , because my brothers and I , growing up , we played football in the backyard . You know we golfed in the backyard . That's how much space we had . But , and so my boys will be able to have plenty of space , we picked a quiet street .

So there , when I left for work this morning , they're all out on their bikes and scooters running up and down the road and the guys that are leaving for work , you know , for their commute , they're like stopping and waiting for them to get out of the way and anyway , cause it's just our neighbors that use that road .

So , but I wanted to have that space and I'm I'm going to hold onto that house . I'm not going to sell it , Um , because they're not . Like Brian said , they're not making more of these places around me . You have , essentially Amelia calls it my wife , she calls them Blam-O-Ville where it's just like oh , there's a house Blam . There's a house Blam .

There's a house Blam Cause I've got patio homes and apartments and and anyway , and we've just got this little neighborhood that's one acre lots , and so we'd like to hold onto that for a long time , but it was really important to us to have that space for our kids to be able to , especially our boys , to just be boys , you know .

But this is a Greek proverb and it says a society grows great when old men plant trees in whose shade they shall never sit . So , thinking about our boys , thinking about the future and our daughters as well , there's going to be this work in the new Christendom of building things that we don't get to see the full fruit of .

But again , it goes back to real property , real spaces and having a foothold in a community . Brian , if you would , I want to hear just a quick plug for one of the greatest books ever written , not yet published , but coming .

It is an exercise in attempting to do something that we often don't do well , which is to see and pay attention to what God has actually done and the wonders of the world . It's not a book that is just like you know . Maybe you've listened to haunted cosmos . It might be your cup of tea , it might not .

Um , it's not a book just about spooky supernatural stuff . It's , it's really a book .

In fact , one of the themes of the book is that if you're constantly running to the supernatural for a dopamine hit and you're not paying attention to God's glory in something like a tree or a blade of grass , or I mean , if we'll just stop and think about the nature of the world we'll live in , it would teach us to properly glorify God in a way that we're

often not . So the book works through various aspects of creation , both the seen and the unseen world , and then simply asks how can we as image bearers and there's a section on man . What does it mean to be a human ? How can we do our duty ? So Ben and I both wrote about half the book each and looking forward to you guys getting your hands on it .

We'll have those pre-orders open soon and , uh , I hope you guys enjoy it because , man , writing a book is a lot of work .

They said please tell Dan that these episodes on finance and what to do with our money have been extremely helpful . The cold opens , the conversation and the actual interviews have been incredible , so make sure you tell Dan . So , dan , thank you . Wow , thank you to the listener .

With the uncertainty of the economy and inflation and a presidential election and lots of different variables , it's actually really difficult to know what to do with cash right now .

And so in this series we've gone through , we'll be going through Bitcoin and gold and real estate and traditional finance through the stock market and 401ks and things like that , and today we're going to be talking about real estate investing and probably a whole host of other things with one of my very good friends , tim Six . Thanks for joining me , tim .

Tim has been in real estate investing for a number of years , and he'll be getting to his story here shortly , but he has found some success , found a niche that he seems to really be thriving in , and so I wanted to pick his brain on real estate investing .

He's also into other investments , so towards the end of this interview I'll be asking him about what other investments do you think are worth pursuing ? And so he's got a lot of good information on that . So , tim , let's jump in . How did you begin real estate investing and what was the timeframe ?

Started selling rocks under my wagon to my neighbors . I moved on to washing cars when I was seven , did the beanie baby flipping when I was 10 , which was oh , that's right , you're doing it on eBay with your mom , that's right , mom's account yeah . Yeah , it was actually more lucrative than you think it was ridiculous . Started there .

I , uh I picked up 13 or 14 lawns when I was about 12 years old and then by the time I'm 16 , I'm starting my first legitimate LLC .

That was a buying and selling specialty defense systems , load bearing equipment for the military on a pro with private account on eBay right , which is using a local manufacturer who had these government contracts but needed Midwest distributors , kind of thing , and so they were . I was happy to partner with them when I was 16 .

That's when we made my first , first chunk of change , if you will , went to college with some good , decent money in the bank and came out of college with no debt , which is incredible , right . So it starts there .

I didn't fly airplanes because my parents were pastor and missionaries and we had no money , but I always dreamed of flying airplanes and so that was the dream . Fast forward to learning about how so many missionary pilots are actually previously trained military pilots and we had no money . It was one of those . Hey , maybe Air Force ROTC isn't a bad gig .

Go try to fly for Air Force for a number of years , then hop out , take the family across the ocean somewhere and continue that dream there . So there I was . Yeah , I was junior year . I'm , for the first time , thinking about committing to ROTC . Usa has this what they call the lieutenant's loan . It's a 0% or 2% interest loan .

You can get 25 grand out and most of my buddies are doing it . They're buying their new trucks , they're buying whatever crap they shouldn't be buying with leverage and I'm like , hey man , this is 2007 . You know , there's this guy Obama versus guy McCain .

Everybody's , uh everybody's a little bit scared about you know , if the Obama guy wins , all my guns are going to go away like the Clinton days . But uh , I saw that as an opportunity at the time . I enjoyed building air 15s but it was uh not lucrative .

I mean you , you know you might make a hundred bucks if you build a max rifle , but it was definitely a slow business . So I decided , hey , I'm going to take that $25,000 out , I'm going to buy 25 grand worth of AR-15 parts and you could buy upwards without messing with the serial numbers and stuff .

I'm going to build those and then slowly I'll build this out . If McKinley becomes president , that's fine . I'll still make him a hundred bucks . A rifle had a gun broker account with a local FFL . But if Obama becomes president , I mean that that 25 grand could turn into 50 overnight if I do this right . So sure enough , you know the rest of the story .

I mean rifles almost tripled in value . So it turned into more than just 50 .

So we have a small little crappy one bedroom apartment on the corner of campus with $25,000 worth of air , 15 parts everywhere the manufacturing business going on but turned out to be obviously a huge blessing , right ? I mean that really all these little tiny businesses grew us into being able to take that money out , why ?

In a way that I hate to say wisely at that age , but at a point it wasn't , it wasn't the dumbest thing to do with 25 grand , even though it was alone , right ? So that was the first time I saw the . I saw the power of , uh , of some compound interest or , uh , I should say compound leverage leverage versus compound interest .

I uh , I was also a kid in high school who I wrote my senior thesis paper . We had to do senior projects . I wrote it on how to become a millionaire by the time you're 35 years old by investing in the stock market , and so I . I had a Roth IRA when I was 16 . I didn't put much in it , which , looking back , I'm actually thankful for .

But that being said , I mean my dad . He's an accountant , financially very wise man , very conservative man , very meager salary for a lot of years but still has very Dave Ramsey-esque style principles , right . So not a bad way to have a basis of avoiding debt and growing through compound interest . I just learned in early age I think there can be better ways .

So that's kind of where we started , dan .

But real estate , the barrier of entry is a little higher , and so , you know , paying cash for a lot of real estate is out of the reach of most people Absolutely , and some would even say that you shouldn't do it . But I'm sure we'll get into that . So let's get into how you actually got into real estate then . So there we are .

I did a lot of those . I liked the principles .

I was actually just got back from a trip uh , with one of my good friends Actually he was a member of the church here as well Um , fellow F 35 pilot , great family guy , four kids uh , very similar backgrounds .

We were just chatting late one night after flying and he was kind of pontificating with me on hey , man , like we're , you know , the air force has been . It's been a great career . It's been a great career already at 10 years as a pilot . We can get out at 12 . And so we're both discussing hey , in two years we have this big decision to make .

Like , what do we do ? We love flying jets . I think the calling is back to that being a missionary pilot . I kind of saw it .

As you know , I thought I was gonna be a bush pilot in Africa , but I think you can do some awesome things , even flying for the U S government , right , I mean , it's still made up of a lot of people who need to hear the gospel and who have families who are important to for our country and everything else .

So I think , besides just flying fast jets and having a great time , the people is why we were still there , and so that's where he was , in the same boat where he's going . Hey , this is not a bad gig . We're , we're , we're making a difference here . I think we can keep making a difference . But we're 10 years now .

How do we have the next 10 years If we do stay in the air force ? How do we set ourselves up with our kids for the future ? Besides , I mean , right now we're , you know , we're making a hundred thousand dollars a year .

So as pilots right , it was officers in the air force great salary , we're happy we're , we're fine , we're , we're taken care of , I get these little side hustles , kind of help on the side too . That's good .

So how do we go to the full 20 , retire and you retire and you know , if you have a air force job , you know you can retire 20 years and what you know , collect half your paycheck the rest of your life for just sucking air . So it's not a bad look . But his point was okay . So that's five grand or so a month in 20 years .

How do we replace the other five grand that we're going to lose by retiring but still have a time with our families ? Because we're looking at our kids' ages and stuff too . My four kids are you know , you'd be hitting those early teen years and whatnot at that age and so pretty important years . They're all important , but anyway .

So he was the one who's who who brought up real estate . He goes hey man , so I've , I've heard about real estate .

What if you know , if you buy a house a year for the next 10 years , long-term hold , cash flowing real estate rentals , intentional rentals , if you will , if you make 500 bucks a month and buy 10 of these in the next 10 years , I think there's the other five grand . And I was like that principle makes sense to me . I don't understand it all .

I grew up in a church , parish style home and missionary housing . I mean it was . You know , I grew up in a real house myself and so my parents didn't own real estate , or a house for that matter . And so to me it was . It was very intriguing , but I didn't know much about it and so I just thought the principle sounded sound .

So I started digging into it . I hadn't read a single real estate book yet , but I talked to some of their folks that I knew that were very lightly in there , and then we're talking like Air Force guys who just turned one of their houses into a rental .

And then I started listening to podcasts and that was kind of light the fire there , but the more I learned , the more I was why aren't we doing this ? And so that's when it started . This is 2018 . It kicks off there where now neighbor across the streets and finds out they're they're going through a divorce .

We liked our house , we decided to buy their house off market , and so you buy their house for you to live in .

So we said , hey , you know what , she can stay there . We got plenty of space upstairs for our family . So now we've instantly got a basement renter house hacking their first house . I didn't know what house hacking was , but it's a term that real estate people use now . And then we turn our house across the street into our first rental .

Obviously , at that time , you know , a VA loan was a fantastic option for us . So we're on a 15 year fix . I was making double payments , trying to pay it off in five years . I had my plan to be debt free within four years .

That was the initial gateway drug , as I call it , which is pretty simple Turn your old house into a rental , buy the next house with a separate unit with it , if you can , kind of duplex style . But this was just a walkout basement and so that's where I started . That was summer of 2018 . Well , late summer of 2018 . So I kind of caught the bug there .

And my F-35 friend same thing . We discussed ideas the whole time . He followed his principles . He bought about one a year . To this day that was six years ago or so I think he's at six or seven units now , doing great and fantastic markets . I say we it's my wife and I , nikki's stay at home mom .

She enables me to work hard outside of just normal work hours we got the bug and started buying one a month . We bought one a month for 40 months straight .

But to start with 30 grand and go 40 units later but that's where it started , dan . Oh my word .

Yeah , the NASDAQ , you've got the Russell , you've got all of this different stuff . Same thing in real estate , right . So there's commercial real estate . You can uh , I'm sure we've all seen the HGTV shows in the , you know , early 00s or whatever . Well , unless you're a zoomer , then you weren't alive yet but yeah , they flip house .

Flipping , you know , and that was like big money , where the big money is , by the way , really risky and lots of taxes , you bet . But so flipping houses , and you can talk more about that if you like , but you're primarily talking about single family rentals .

Essentially it's kind of dumbed down there but once you go past four units in a building , that's commercial . And so now you're in a commercial loans , commercial package .

Nick and I at that time , we probably were married seven or eight years , right , and so we probably lived in six or seven houses because we move a lot , and so I know how to live in a house and I know how simple it was to be a tenant , and I thought about the fact that anytime we were a tenant somewhere , we'd take care of the place .

I probably talked to my landlord one time a year . I was like this is pretty simple . I mean , who wants to talk to your landlord ? So I thought , of all the real estate , at least I understood that principle . I think we could do that Because , at the same time , right , I still have a full-time job . I'm still flying in the Judson Air Force .

I can't go full bore commercial multi-syndications vacations . I'd love to do that someday , but it's not now , right . So where are we at today ? It made the most sense , and then , besides that point , I was also still somewhat adverse to using leverage . Right , I mean ?

My principles were still trying to become debt-free and so using leverage to me is like it's like cooking with fire . Right , I mean ? You give a , you give a four-year-old a match in a newspaper and like you're going to burn your house down .

Right , I mean you give a , you give a four-year-old a match in a newspaper and like you're going to burn your house down . Right I know ? Actually , don't ask me how I know .

I can heat my house with fire , I can cook with fire . It can be good too with fire . It can be good too . And so I saw long-term hold residential real estate as a place that , principally , we all need a house , we all need a roof over our head , right ? So there's always going to be a demand for residential real estate .

I mean , obviously , commercial real estate kind of has been one of the better investments over time if you look at the numbers , but there's still the biggest . Some of the biggest fluctuations have been of commercial real estate too . Long-term hold residentials in a lot of ways is kind of boring , but it's also .

If I'm going to use leverage , I thought it was the safest way to do it .

It could even be unfair in some ways in this investment series , because with Bitcoin , with gold , with stocks , essentially what's required of you is to buy it and then to sell it at some point , and that's how you capitalize on it , unless you have a dividend bearing stock and then you just collect dividends , whatever .

But with real estate it's different because , while it is an investment and it is an asset , you also have to run it like a business and and you mentioned that like talking to a landlord and things like that . So I just want to ask what's required . And then I would like to next talk about , like , how do you actually monetize ?

You know , how are you getting your returns on that investment ? Then , if it's not , cause it's not as liquid as gold and stuff like that , so what's ? I got an eye roll , uh , no it's absolutely true , oh , okay . Um , so yeah , just tell me what . Tell me , uh , you've got quite a few doors .

You said you you bought and sold , you know , one a month for 40 months . And every time I talk to Tim he's like oh yeah , I'm closing on a house today , whatever . And so you've got , you've got a large number of doors . I know you've got a couple of guys working for you , but tell me kind of what's required .

It's anything but passive in a lot of ways , though , right , You'll also ask earlier if I would suggest any other investment strategy style things , and I'll first say that probably one of the better ways to build wealth is starting a business right , but over time , those businesses you know businesses come and go .

I don't know what the , what , the , what the newest percentage is ? But you know something like half of businesses don't survive their first three to five years .

Well , I'd love to have time to start a business . I don't right , I still got this full-time job here for another few years in the Air Force and that's going great . So I'm going to keep doing that . But I thought , well , the real estate is kind of a happy medium of some people say it's passive , some people say it's active .

I think there's a happy medium for us in the life stage that we're in . We've met that balance where it is a business , absolutely .

And I go back to the example of how many times I mean we've all run into houses in our past , right when we were starting out , how many times you talked to your landlord .

I've got a got a few guys working for me a full time and they're they're a huge piece of this right Employing , um you know , good labor and guys who want to be a part of this too . They get those calls . I don't get the maintenance calls . I still place all the tenants . I still do , I still have the leasing and I collect the rent .

But even all that so much . There's so much automation these days with all the technology we have at our fingertips .

Like how do you actually realize , you know , this investment , how does it make money ? But so you're trying to figure it out .

You go through the closing process and all that and then you've got to figure out , like now , what's really wrong with the place you know , and get it ready for a renter and then , beyond that , I'm sure it depends on the market you're in and you also have different classes of single family rentals .

So you have different issues if you're a slumlord versus if you're BC Sure . Yeah , yeah . So so you have different , different rental rates as far as defaults and things like that , so , but it sounds like most of the time , though , is spent on the acquisition side , not necessarily on the maintaining side , that's right .

So so , so much time has gone into what you've already said , and setting up that portfolio to hopefully be on autopilot someday and even to extent today , is right , which as and that's and a lot of that . That time has surged . It's kind of funny . It's surged with in and out of jobs I've had in the air force , right .

There's certain times I just I haven't had time , so I can't acquire , even if I had cash . That's not a time I could do it because of the time I had . It's kind of funny to think about . People always talk about time in the market and even now , hey , rates are so high and how can you afford to buy . I agree to an extent , but to me it was .

We surged in purchasing and placing tenants . Really when I had time I didn't look at the timing of the market . I think it goes back to Warren Buffett who says it's not timing the market , it's more important to have time in the market .

I don't know many people who have invested in real estate for at least 20 years who haven't been successful Right and so if you keep a long-term lens on real estate , if you look at any 10 year period of real estate , I don't think , using sound principles , not being a slum board , placing good tenants , creating good housing , good , affordable housing that's safe ,

safe and that kind of house you and I you and I wouldn't mind living in Right Then you're going to place the right kind of tenants . You're going to have people there who are really essentially partnering with you and that's kind of how I've approached it . I know a lot of landlords landlords . It works for them to to kind of have the .

I manage my properties but I don't tell my tenants I own the place . I tell them the landlords to have the mean guy kind of thing . I've never been that way .

You know they want a solid roof over their head , with a landlord who cares , who's going to fix things when things are broken and not uh , not to be a sleazy , you know , collecting checks kind of guy . And so all my I mean my tenants from the start .

I tell them who we are , tell them about the kids , tell them about you know , hey , I'm an active duty air force officer . We got a set of stuff going on . Do the air force officer ? We got a set of stuff going on . But you're gonna meet my maintenance guys . They're local . Obviously we're not , because we move all over the country .

Then partner with the right renters .

I mean you just you just say something about COVID and all of a sudden it's a good off jail free card for nine months . A lot of people really struggled through that time and we had our struggles .

I had a couple you know oddball tenants who just decided to kind of go off the reservation there , but for the most part people were like no , we get it , I still had to pay my mortgage , we still had expenses to pay , we still had taxes and insurance to cover and we still had a good house to provide them . And so I can't do that for free .

And so people understood that and we I mean it was actually , I mean looking back on 2020 , 2021 , obviously that was , you know , appreciation wise , that was some of the best years for real estate ever but it was also a great .

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On on on the returns from the rent , you're able to cashflow it and that's going to be the main way you make money on a rental on on real estate . Is that true , and are there other ways ? I've heard there's five .

part . You know you buy a stock for a hundred bucks , sell it for 200 . There's your appreciation right .

The price goes up and you sell it , and that's how you realize your profits and you don't have it anymore .

If you have a mortgage , right , we could talk to the mortgage stuff more in depth that you want , but you're going to have some kind of principal pay down and this is obviously cash flowing real estate . This is real , this is a rental , this isn't a piece of land that's sitting there .

I think at least in our last stage of life we need to be buying cashflow positive real estate . And you mentioned the 1% rule . That's a great principle that I live by , by for most of this building , which is the 1% rule is yeah , go back to that a hundred thousand dollar example you pay a hundred grand for a house it .

Yeah , go back to that a hundred thousand dollar example you pay a hundred grand for a house . It should be kicking out . You should be renting it for a thousand dollars a month and that's the 1% of your purchase price which , over time , if you look at your expenses and your mortgage and all that , you're probably going to cashflow .

If the inflation piece is , you go back to that $100,000 house with the $80,000 mortgage . Historically inflation's around 3% . That's the way the system's built , whether you like it or not . That $80,000 fixed rate mortgage , which is a luxury that we have in America , that that's such a common mortgage . It's not common across the world .

That $80,000 fixed rate mortgage . Essentially , if you look at it , it's kind of debased by 3% a year . Right , I mean , in nominal dollars it's still 80 grand , or let's say it's 77 grand the second year . As you pay it down , nominal dollars are still the same , but inflation is also pushing you another 3% .

That's right , because you have rising costs of both real estate and then inflation , so your purchasing power is decreasing . So essentially , what you've done is you've frozen that moment in time by taking out a loan .

And then if you take that further , that 90% of millionaires who made investing in real estate , it also comes out of you know , you got the business owners who create awesome businesses . You create wealth where that wealth usually ends up in real estate . Pretty interesting principle if you look that up .

But anyway , so our first two deals that first month , january 2019 , I got the bug . We've got the gateway drug going with the local stuff . I'm from Indiana . That's where my wife and I went to Purdue , and a lot of friends are still , family is still there . You know a lot of connections and I just I knew the area .

So I thought , man , we're moving all over the country . Of all the places to buy , Indiana makes the most sense . It seems like cause . Rents are still strong , but you can . Your . Your entry level price is a lot lower than the Mountain West right now and where we were at the time when we started this too .

So our first deal looked like a really traditional hey , hopped on Zillow , hey , that's a nice little duplex for 110 grand . It was $110,000 , a nice town , great area , good schools , with two tenants . One's paying 500 bucks a month and they were just paying like 650 a month , so it got my 1% rule right At the time . I've got no kidding , dan .

I've got $30,000 in cash . I took a $50,000 loan against my retirement account , my Air Force retirement account , which was in a decent spot at this point , cause that's all I've been doing really is , you know , taking this , all these little side hustles , and putting in the , the Roth IRAs and Roth , the Roth TSP traditional TSP at the time , anyway .

So I pulled 50 grand out of that , which is a loan against myself , and I pull a $25,000 Amex personal loan . So I've got 105 grand cash in my pocket , of which , you know , part of it's mine , part of it's already leveraged . But that $105,000 cash is what we started with .

I took that first duplex of $110,000 to use a standard 30-year fixed rate , fannie Freddie , which is a federally backed non-recourse loan , a really advantageous loan , of which any person can get up to 10 of them , by the way , which we can go to that later . We could probably do 10 episodes out of this , dan .

We actually negotiated to 105 . Now I get the mortgage for what ? 75 grand now , with a 30 grand out and the two tenants are paying the mortgage , I'm cash flowing . I've started this journey of the five ways that real estate pays you . Pretty cool . Okay , if you look at all those numbers , it's probably easier .

If we did an episode , we're actually right down with pencil and paper and I show you like why . If you're not making at least 25% a year in real estate , you're probably doing something wrong , or I was . I would not be happy with my returns . They weren't at least 20 to 25% , right ?

Your interest rates , well , it's about 30% higher than what it was for an investor loan back then . Those are five and a half percent Today . I can still get them at seven and a half . So it's gone up about 2% on the interest rate . But the values have gone up too right , and that's what we're all complaining about . But guess what ? So have the rents .

So if you look at the linear scale , it's actually they're not that far off still Okay , at the end of that same month . so this is going into month two . For the second purchase , I hear about the BRRRR strategy . Brrrr , you know that one , dan Mm-hmm . So , brrrr , you buy the fixed wrapper . You try to find the worst house and the best block standard .

Buy it in cash usually , because that's what you have to do , because these are usually fixed wrappers that you're not going to get a traditional loan on . You rehab it , that's the first R . You rent it out , you refinance it and then you repeat the process . That's the four R's . So this is where you see the dumb .

Whatever the TikTok , sensational videos of infinite returns to real estate , which is a lot of BS .

Great neighborhood in Indy coast , not too far from where I grew up . It's a small neighborhood . This house is listed for $105,000 . It's a little two bedroom , one bath bungalow , if you will , indianapolis area .

It was listed for 105 , but when I was looking at it it was down to 70 grand and I've seen that it was under contract twice and fell out of contract . So you know what that means . Something , something's wrong with it . So a realtor friend of mine who was a roommate in college , I have him go check it out . Sure enough , foundation issues .

They gave us the inspection report so we knew the extent of what needs done and so I've got it . At this time if you think,000 , I've got like 85 or 75 grand left in my pocket . We offer them a 60 grand cash for the house they accept . I paid about 10 grand to fix the foundation . I used the last five grand to .

You know we did a little fresh paint , some some flooring and some gutter work . That was what it was on that house . So now I've got about 75 grand in that house cash and you have no money . I don't have no money left , dance . What do I do ? I can sit on it and I can rent it out .

So you know , this is where this is , where we talk about differences in opinion on leverage versus not . So at this point I put it on Zillow . I rented out to a nice lady who's still there to this day Fantastic tenant she's running . At that time it rented for 1100 bucks a month because house worth one oh five , 1% rule .

Yep , sure enough , $1100 a month is what she's paying to rent . So now I can stay there and be happy collecting my 1100 bucks a month . Or I finished the burr , which is you refinance it , which is really I put financing on it for the first time . So I go to the bank , bank comes in , appraises it .

Sure enough , it appraises for $105,000 because man , it's basically what it is , and the bank at that time , on your refinancing , you can pull 75% loan-to-value out , so it appraises for $105,000 . My 75% loan-to-value is around $80,000 loan right , but that's cash that they give me back now .

So on a $75,000-ish investment , I just got $80,000 cash back in my bank account . That is tax-free . It's also tax-advantaged . That's your fifth way that real estate pays . You is tax-advantaged . I just essentially made quote-unquote , made $5,000 that I now have a mortgage on .

That mortgage at the time was like $470 a month , if I remember right , but my tenant's paying $1,100 a month . So $500 mortgage , $1,100 in income , that $600 delta .

Keep a couple hundred bucks for maintenance and unknown expenses , you know you're cashflow on $400 a month essentially in your bank account with zero money down , right , that's where you get this whole infinite returns on no money down . And it can be true . But you gotta be careful too .

You gotta buy the right property contract it can't screw you and you gotta find the right tenant to partner with and then put good , good long-term debt on it , right . And so my W2 income from the air force helped me qualify for that loan too . So I always tell guys too I don't think you can just quit your job and go do real estate .

You've got to build your wealth to a point , I think , in a lot of ways to have that cushion , that fallback , but also to be able to qualify for these , in my case , loans , which is how we grew . So the BRRRR is how we did that . That rental is still , I mean . So okay . So back to your example .

Previously , dan , we talked about fixed rate and time right . So this is 2019 . That mortgage is $470 a month . It's gone up a little bit , obviously because taxes and insurance have gone up unfortunately because everything keeps going up . So I think that payment might be five . It might be 600 bucks a month now .

Right , with how much taxes and insurance have gone up . But that market rent has adjusted with the market rate and I write this in my leases too . It's never a surprise to my tenants .

I write a three to 4% appreciation rate in the lease per year just to match what I know my expenses are going to go up with too , and obviously maintenance expenses are going to go up too . So that $1,100 rent is now I think it's around 1450 is what they're paying now . So that Delta is part of that appreciation , of fixing that leverage in time .

Right , because the US dollar keeps devaluing , obviously cause .

The banks will want to give you 230 out then . So once again , you just made 30 grand on it , but that's tax-free because that's a loan . I still have a mortgage I have to pay back .

So that's what it looks like on the surface , but really , if you dig down into it , to me the US tax code , as complicated and as awful as it is to get through it , I think Tom Wheelwright who coined the phrase that the US tax code is a book of incentives it's what the US government wants you to invest in .

And so , if you look at it , wt employees to the US government unfortunately get spat on . You're paying the highest percentage of taxes , but you're also the lowest value to the US government . You're just a worker , business owners , tons of tax advantages . Right , because the US government wants you to start businesses . They want you to be successful .

I'll stop there . They want you to make money so they can collect their taxes . But there's a lot of business advantages too , right ? Real estate strategy is no different where the government ? If you look at any HUD or any kind of government housing project , guess what ? They're all horrible , right ? I mean , show me one good example and I'll show you 10 bad .

So I think the government acknowledges that . So they need small mom and pop style landlords across the country and companies to extend , I guess , to provide affordable , clean housing for people who need it , whether we like it or not . I mean , sure , the American dream is for everybody to own a home , but it's never going to happen , right ?

And I don't think people even want that People in our camp , obviously . I think there's a lot of great principles in owning home and real estate in your own home , but the reality is , over the last 100 years , I don't know if the home ownership rate's ever gone above 60 , mid to high 60 percentile right .

In a lot of ways , they've incentivized real estate investors to provide good , clean , affordable housing by giving you all these tax benefits . Depreciation is the easiest biggest one to talk about right .

Depreciation is where that same $100,000 property if the home is worth $75,000 and the land is $25,000 , that $75,000 will be depreciated over a 27 and a half year schedule . We're digging into numbers here but , bottom line . That's going into your . That's going into that .

If I'm not making at least 25 ish percent on a real estate investment , I'm not happy with my choices . But that's going into that . To that factor , because that depreciation schedule is is is coming across my desk as a . It's not a credit but it's a . It comes off the taxes , right .

So it's this one easy advantage where you don't have to spend money to get the credit on your taxes . There's a lot of things . Hey , let's fly to a conference , dan , and go to I don't know . Go to Vegas to do this real estate conference . Sure , you know we spend three grand . We can expense the three grand Depreciation .

You can expense that off your taxes without actually spending the money ever .

, in 10 years you've got a bunch of properties now that have been you know 40 , they're only have like 40% of the loan value on it or or less , because of inflation and all that . And if Tim says , you know what , I think I really want to buy a vacation home in Alaska and buy , you know he's out of the air force Now .

He wants to buy his own plane to fly there . All he has to do is take a portion of his portfolio .

He can refinance it , cash out , refinance , and he has all of that money is is debt , but he didn't have to pay any taxes and he now has cash in his bank account that he can then go and buy whatever he wants , and in the meantime , he has tenants that are paying down that debt , and so that's one of the ways that you can realize profits is by refinancing

, but anyway , check's true , okay , which makes it difficult to do with other assets , but even like Elon Musk has done this with Tesla shares and things like that . That's why a lot of CEO types they'll actually not take a salary , they won't take any W2 income , they won't take 1099 income .

What they want is stock options , because then they can leverage those stock options to get paid without paying any taxes . So , anyway , those are a couple of ways , tell me for the average person , not that we're telling you this is the best strategy and we'll actually get into the risks in just a minute . That come with real estate .

But if somebody did have some cash and they're like , I don't know , I could buy Bitcoin , gold stock . You know the stock market , I don't know , real estate seems really interesting , I can . Only nobody's making more land . You know you can mine more gold or mining more Bitcoin , and , and you know companies often issue more shares , you know .

So where do you start ? Yeah , well , um , you know companies often issue more shares . You know , so where ?

So in my opinion , it's what I did myself , right , I'm not saying it's for everybody , but if you're okay with debt that $30,000 , even today you get to go to the same strategy that we did six years ago , right , or five , five , nine years ago . Where that's , that's a , that's a legitimate down payment on a , on a nice house in the Midwest South .

You know , choose your area of the country , that's not the mountain West , um , that's a legitimately decent down payment on a house . That's , that's probably going to cashflow . Those markets still exist .

Yeah , we , we're , we've slowed down , right , I mean kind of backing that like we're a little bit busier in the job right now , so guess what Things have had to slow down a little bit . I also don't think it's a bad time to not go crazy with where we're going with the economy right now . Is it a hard landing , a soft landing ?

Any landing that we're just going to keep inflating our way out of this ? Any landing ? Yeah , I mean , let's just go to the moon .

If you buy the first one , you'll realize how easy it is . And then you know there's there's really nothing stopping you right . Well , you might hate it , I don't know , but what are you going ?

It was sold on auction , just trashed . I'm just , you know , back to that worst house on the best block and I bought it , thinking I could rent it or flip it . And so this is my first time I'm thinking , okay , let's fix this one up to maybe try to make that . You know , 50 grand without the mortgage . And then now my cash ball is , you know , $130,000 .

And what could go wrong went wrong . Right , it was one of those .

They're paying me like a hundred bucks . I bought it for like $20 . And you're like Dan , you know you make your money when you buy , not when you sell . That's right . Yep , that's absolutely right Stuck with me .

You maintain that profit margin If you find the right contractor . I'm not finding a contractor yet that I'm going to make more money because he was cheaper , faster , awesomer . I mean there's , there's great , fantastic contractors out there who work with integrity and , and and and good work . There's lots of them , but there's not many , yeah .

So with the , when it comes to the contractor , to me it was almost . I want to stay at least to the numbers I predicted , right . And then uh , and then yeah , when you sell , you just harvest those gains , right , that's all it is .

And so , on this deal , I mean we I didn't have a team yet I was trying different strategies on , obviously , bids , but then general contracts , subs and from across the country yeah , you're not in indiana at this time it just did not . It was not a great strategy . Everything went wrong and so to the point where it's like I just got to .

I mean , we finished it . I found a good Christian contractor who finished it for what took me well past my budget , right , and try to figure things out . And it's like we just got to sell a thing at this point because my reserves are so low and so we're in that time .

But sell a thing at this point because my reserves are so low and so we're in that time . But guess what ? It goes on the market . We get a few offers all and in the end no kidding , I break even and I was like there's , I mean , how , the how did I just break even on that deal when everything went wrong ?

Like there's , you know , the house did way more work . Every you know every knob and tube , wire was everywhere and plumbing was there's actually foundation issues on that house we didn't know about . There's brick more if they're needing a new room . It was like no kidding . It was . It was a house in hell .

Perhaps , if there's enough interest on something like this , we could partner with Tim and maybe release some of the equations he uses or something like that . But we'll see . We'll have to see if people are interested enough in that and if Tim is willing to share some insider information . You might have to pay for that .

So what are the biggest risks to real estate ? You just talked about that with your story . You buy something and there's a whole bunch of problems . Contractor screws you . I didn't know it needed a new roof . You know there's all those sorts of things , but I don't know if that's necessarily the biggest risk .

That was a big risk and that was was I don't know if anyone saw that coming I mean for the , the reach of the government , to go that far into our businesses in that way .

I think that was probably hopefully that was the black swan event that show what could happen I mean essentially what happened is the government said that tenants could steal from landlords .

Talking about World War III makes me a little nervous .

This is going exactly where I thought it was going Well , and so I mean you talked about soft landing , no landing , hard landing or crash landing . Okay , yeah , if you want the shorter term , sure . Yeah , Okay so what's going to happen in the next 12 months ? I don't know . That being said , I think there were so many people I mean , who was it ?

Was it Goldman or one of the big banks came out with a hundred percent chance of recession in 2023 . Right , and when everyone's calling for the same thing that's usually when you should probably look the other way , right ?

I'm not saying we're going to have a hard landing . None of us know that . I mean to say that with any kind of confidence . I think you can use all the signs you have to make your best educated guess . But there's still a guess .

I'm not bearish , but I'm also not I'm not super bullish over the next you know 12 to 18 months either , but that means we're still buying right . I mean , we just closed you're right , I closed my house a couple weeks ago , but you know what the house was in a standard great , great , great neighborhood it hit the buy box .

Get the management place with the , the team in place . The businesses is kind of firing on all those cylinders barring yeah , natural disaster , world war ii or world war iii , and and uh , no one paying the rent anymore . Let me show that's gonna , that's going to crush more than just me , right ?

That being said , I mean I had a mentor early on when we first started this , who had the advantage of a grandfather who built a portfolio like this in the 60s and 70s , who survived the 70s and 80s and 20% mortgage rates , because he did it with debt , but he passed on to his son , who passed on to his son , who has all the advantages of that generational

wealth being passed down through a strong Christian family . He was really instrumental early on and mentoring me in a way that said hey look , I don't have to use mortgage debt because my grandfather took that risk . So you've got to understand that , like you could go bankrupt next year , I could go bankrupt next year . Right , and I have .

I have leverage and I actually have .

I absolutely have obligations that got to be paid and and sure I mean something could happen , and , and all of a sudden we're upside down and we're forced to sell for some , you know , for some unknown reason to me today , Right , Because I always say as long as you're buying cashflow in real estate , I don't care what it's worth .

If you look at the net worth column and the Excel spreadsheet , I can't eat that unless I'm putting more debt on it , which I don't want to yeah . So even if the portfolio gets cut in half , value wise , as long as the rental rates stay close , I mean , my goodness , even if they take a 30% cut , that's we're still okay .

So that's why it goes back to buy cashflow in real estate , have the reserves on hand and then don't look at what it's worth . I mean honestly , unless you want to keep harvesting it and keep going , which that's how you grow . Uh , at least I'm sorry , that's how we grew .

You can do it different ways , but , um , that'll be instead of you know , worst case happens you go bankrupt . Terrible principle , you know , pay your debts , but you know what I mean . A lot of things have to happen at the same time . I think you know I still have the mentality of glass half full . I bet you , we can rebuild somewhere .

I'm not in , you know , an economy economic professional by any stretch of the imagination , but unemployment rates rising could be concerns and things like that . But yeah yeah , that's right , so I want to .

I want to ask you one last question , other than real estate , what do you think could be some good opportunities right now , even if there's no opportunities cause there's a lot of uncertainty , what , what have been for you or , you know , what would you consider ? I ?

It takes it a certain style of person entrepreneurial and certain personality traits , probably , and risk tolerance as well , and how you know work ethic that it's not for everybody either . I I've equated my real estate business to small business mixed with real estate .

We're not just buying retail stuff off Zillow , right , we have a business , we have a process that acts a lot like a small business . So I still think if anyone has an entrepreneurial spirit , that drive , has that risk tolerance and that work ethic , I mean , find the niche that works for you , but start that business and give it a shot .

Once again , what's the worst case ? Sure , I guess you could get an expensive education , but you'll pick yourself up and keep going . So I still really like small business . I think there's great principles to owning assets , like you talked about . Those are real assets , like real estate or gold , silver . Sure , obviously , we still do that .

It's kind of where we got our start a while ago . Anyways , I still think we hold a decent amount of reserves with that . Crypto is a weird one to me , right ? We've we've had a lot of discussions on crypto , dan , where .

Pay for it . Right , that's an unproductive asset , but I'm not a currency investor . Right , I try to produce a real things that produce a good or service .

Right , it's a great insurance policy , but if you're 25 years old getting started out and you got five grand in the bank , no , I would not advocate what I did , which is buy a bunch of gold and silver , but I was buying it to try to sell it for a little more than I paid for it , not to hold it for 50 years . Right , I think we'll get .

I mean you'll get there . Build your business , find the right stocks that work for you , you know , do your best to work hard , work at a side hustle and , and if your family can , you know , can support it too , I mean 40 hour work weeks uh , it's a baseline for a young person .

But I think I mean I hustled my , my butt off in my , my twenties and early thirties , which set us up for right now with where we're at with our kids . I think if you're not , you know , hustling your tail off when you're in your twenties , I think you did it wrong .

You know ETFs and whatnot which , when you look at inflation and then taxes , and then I mean to me so I feel like just inflation and taxes that 10% becomes . You know about 4% , real fast , uh , which is abysmal to me .

Um , and then if you also include what I would call , you know , lost sleep and heartache when you're watching that thing , if you're , if you're looking at your phone more than once a day at your stock . You know stock picks like how is that ?

It's a good way to you know to to compound the wealth that you have , but obviously so you'll see this a lot on on the Tik TOK and on YouTube and Twitter and stuff like that .

It's like you know , some guy bought a thousand dollars in some meme coin or some obscure penny stock and hit it big and now it's worth $30 million or whatever , and so there's a temptation there of taking . Well , I only have a small amount , so I'm going to take the most tremendous risk I can in order to generate wealth .

It seems like from your story , your personal experience same thing with what Jace had talked about , just talking about personal experiences even the story of New Christen Impressed , which might be worth telling someday if we're continuing to produce content and to become more stable in the future as a long-term entity , is that these small beginnings actually don't take a

tremendous amount of money and with some hard work , you can actually grow wealth , which is a different thing . The thing that is so off-putting to people is the complexity Doing real estate to the outside observer just speaking from my own personal experience my word it just seems impossible . You know , at times , you know it seems very difficult .

You have to front quite a lot of cash and there's regulations and taxes and how do you do this and how do you do that ? And really it's the same thing with business in a lot of ways . You know , I had started and closed down an auto business at one point . It just didn't . It took too much time .

But the amount of regulations I guarantee you there's more auto regulations for buying and selling cars than there is in starting a real estate business or even getting your real estate license it took forever . But the thing I want everybody to know is that if you're just resourceful , you can figure it out Like none of this is impossible .

How many real estate investors are there ? There's thousands and thousands of of real estate investors . If those guys and not all of them are very smart , if they can figure it out , you can figure it out , you know . And same thing with businesses . Every town is loaded with businesses . If they can figure it out , you can figure it out .

So I mean it's funny how , in this investment series , it seems like what is being landed on is funny . Jordan Bush even talked about this with Thank God for Bitcoin , as a conference is actually a business , and so it seems like every single episode is ending up in one of the things you should consider is generating wealth through starting a business .

One of the things you should consider is generating wealth through starting a business , and so I know we had talked about it some years ago . It was like side hustles and starting businesses and things like that . So that's something to consider .

And if things continue in the future as in the past which is a caveat for everything .

Back to the other point is yeah , money that comes easy goes easy too , right that money fast . It can , it can be lost real fast .

So real estate's a good fit for me because it is slow , right , and it's a business for us . It's not super sexy returns at first and it takes a while to get going and there's a lot to learn . But most businesses are like that .

You know , if you're looking to make money overnight and you don't have at least a five-year outlook on something I would argue a 10-year outlook , then I mean , you know , go back to your W2 and and check your stocks every day , you know . So to you know .

To to Jason's point too uh , maybe he made this point or not , but there's guys out there who who just might not feel like they fit into starting a business . I'm not a creative guy , right ? I mean I can follow a system , I can do , I know my way around Excel spreadsheet's just fine .

But if you asked me to start a business tomorrow , I'd probably pick something in housing , right ?

And if you're a young guy hearing this and going , well , what am I , what am I going to do ? Find a guy like that , like who's who wants to do that , or the Jason of the world who he's only got so much time , though I've only got so much time in the day . I had a really cool offer from a guy in the . We have lunch .

We're talking real estate , standard stuff . I like to share the story and I like to try to pull guys alongside if they want , you know , be pulled . And he makes the offer Don't want to work for me for free , like that's . That's a really smart offer . I I've I've never thought to do that , but if you're a young guy out there going , how do I learn ?

Find somebody who's doing what you want to do , and you might . You might not have the time , you know if you got kids and whatnot , but but if you do and you have the scrappiness to work in the nighttime , kind of thing like find the person you want to be , like emulate them , but ask them if there's something that you can do for them .

And now you're going to learn they're going to pull you into that . You know they're going to pull you into that business .

You know education , that was their secondary education and so , yeah , you can emulate that and you know even even a deal like that where it's like , hey , I'll , you know , I'll work my tail off for free . I just want to learn from you . You know that goes a long ways . That's really good .

Yeah , I think the thing that I might have said this on the last episode , the thing that's really interesting , is that you get a lot of younger guys and they ask I think in some ways they ask the wrong question , but they'll come to you to , um , you know one of the guys in the church . They'll come to you .

They'll come to Jace or me or or you know any of the pastors and say , like you know you've talked about starting business and side hustles what opportunities are out there ? What should I do ?

I'm like I don't know what you should do , but I can think of 15 different opportunities in the last two weeks that I've thought of and have had to say no to there . Once you know to look for opportunities , the opportunities are everywhere , just like , just like you , you , you said you're not a creative guy . Maybe not .

Like you know , the Jace is a visionary . Like he's got ideas . He's , you know , started started neighborhood by city blocks . You know this is how we're going to take Chris and him into Ogden and whatever . He's got all of these big plans , starting banking system , like the whole deal . The guy's just he's crazy , like that and it's great .

But , like you said , when , once you started in real estate , you're like well , if I was going to start a business , it'd be HVAC , it'd be roofing , we could do landscaping , you could do , you know , foundation repair . I mean , like the , the opportunities become just so great that you just have to say no , even even uh , uh .

I heard someone once say like uh , just because something is a once in a lifetime opportunity is just a data point . Those , those opportunities actually do come along . Quite often they're really not once in a lifetime . You know , it's just a , it's a , it's a good opportunity .

So one of the one of the things that you should do is just be interested and start trying to make things happen because you can figure things out . You can really do it . It's not beyond you . So , tim , thanks so much for joining me . This was a lot of fun . I hope people really learned a lot , and I just wanted to say thanks for your time .

Appreciate it .